In August 2021, approximately 4.3 million American workers quit their jobs, per the Bureau of Labor Statistics, noting that a 2.9% resignation rate has not been experienced over the past 20 years. Most of these resignations are linked to the leisure and hospitality sectors, which include restaurants, hotels, and bars. This incredibly high resignation rate clearly shows that the workers now want something more than just a paycheck.
"It is time for me to find something better, something more stable, from which I can provide for my family. I am looking for a job that offers me more flexibility and better benefits..."
- Jessica Thomas, Former Bartender and Waitress
Millions of other Americans share the same thoughts as Jessica. The pandemic provided employees a year to reflect on their needs, forcing many to find alternative employment options. Additionally, the increased number of remote positions and flexible schedules quickly shaped a new way to work. Employers also had the chance to rethink their work policies to keep up with this rapid change.
What is the "Great Resignation?"
The Great Resignation, also known as the “Big Quit”, is a massive wave of resignations that American employers are experiencing where employees are quitting their jobs in droves, and the number seems to increase with each passing day.
Microsoft's 2021 Work Trend Index revealed an alarming fact: around 40% of the global workforce is looking to quit their jobs in 2021. A survey conducted by PwC in August also found that 65% of employees are now looking for new jobs, while 88% of executives reported higher turnover than normal in their business.
Why are millions of Americans quitting?
The trend started in the spring of 2021 and is still prevalent here in the US. The main driver is, of course, the pandemic, and workers now demand more. Changes sought range from more government intervention to protect workers, addressing the rising cost of living and static wages, to job uncertainty emanating from the pandemic shutdowns. The resignation ratio spiked further in October 2021 when employees declared strikes and labeled the month of October as Striketober.
Employees from both the manufacturing and healthcare sectors rallied in strikes to demand better wages, safer working conditions, and financial stability. Further emphasizing the need for businesses to reevaluate their policies, new college graduates and those just entering the job market sought flexible working conditions as well.
Americans now demand better working conditions, flexible working hours, emphasizing the need to maintain a healthy work/life balance.
A Potential Solution
The US continues to experience this great resignation, so businesses need to think outside the box for employee retention. Forward-thinking employers are utilizing this wave to attract and maintain top talent by changing policies and implementing new benefits. Considering there are 50% more job openings today than there were before the pandemic, it will take much more to attract, retain and hire than ever before.
How you choose to respond to the Great Resignation can be a make-or-break for your company. We recommend taking a holistic look at what your business currently offers to your employees and then providing the options that are most in demand. According to the PwC Future of work report, ‘expanded benefits’ is the second most wanted option after the flexibility in work schedules for employees. Now more businesses than ever are considering an On-Demand Pay solution, also known as Earned Wage Access (EWA), as a core benefit to provide to their employees.
On-demand pay allows employees to access their earned wages immediately without waiting for the normal payroll cycle. It is a proven method to elevate financial resilience at your workplace while reducing stress for your employees.